China has quietly almost doubled its gold reserves to become the world’s fifth-biggest holder of the precious metal, it emerged on Friday, FT reports.
Hu Xiaolian, head of China's secretive State Administration of Foreign Exchange, which manages the country’s $1,954bn in foreign exchange reserves, revealed China had 1,054 tonnes of gold, up from 600 tonnes in 2003.
This signals one thing, China doesn't trust the dollar, and knows the Fed can't print gold.
Bloomberg reports the Chinese as having increased their gold reserves by 76%.
ReplyDeleteGold, of course, is only part of the equation and they are moving into resources internationally in a big way. My guess is that it wont be long before the big boys start playing the "economic nationalist" and "strategic reserves" card to counter China's attempts to prevent themselves from being screwed.
What concerns me is that to sell these protectionist and restrictionist policies the elite will turn up the heat of Sinophobia. Can it happen? In the US, Sinophobia is something the neocon right, the Tibet-ophile celebrities and the labor union left can all agree on. They will of course portray China as an undemocratic nation engages in state capitalist shenanigans. As if Wall Street hadn't written the book on shenanigans. Sinophobic bluff and bluster however has the seeds of becoming a self fulfilling prophecy if the Western power elite actually succeed in their China shake down. During the last depression it was the "have not" powers who ended up on the enemy list in WW2.
Does the building up of gold reserves give China some sort of protection if it decides to start selling its dollars and refuses to buy more US Govt debt? Either action would presumably result in a collapse in the value of the dollar which wouold potentially hit China cos it has such huge dollar reserves itself. Presumably huge gold reserves would give them some protection from such a dollar collapse???
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